KB Lets the Sunshine In

Homebuilder KB Home recently opened what it says is the first residential community in the Antelope Valley to offer homes with solar power equipment as a standard feature. The Arroyo community, located on the east side of Lancaster, is one of a dozen the developer has built in Southern California with the solar equipment. KB plans to build 1,000 solar-equipped homes in Southern California, including homes at the Echo Pointe and Echo Ridge communities in Santa Clarita and Milan at West Hills in Valencia. Home sales are still weak, so developers are looking for an edge to attract homebuyers. Combining an affordable sale price with long-term savings on electric bills helps to entice potential homebuyers to opt for a new home, versus an existing one, said Tom DiPrima, KB’s executive vice president for Southern California. The market in the Antelope Valley is geared toward first-time homebuyers, DiPrima said, noting that prices at Arroyo start at $200,000. At Arroyo, KB plans to build 90 homes on half-acre lots with the standard solar equipment. The basic solar system, provided by SunPower Corp., produces 1.4 kilowatts of power, or enough power to reduce energy costs by 30 percent for a 1,800- to 2,000-square-foot home, DiPrima said. If homebuyers choose to upgrade to a 3.15 kilowatt-system, the cost is $5,000, DiPrima said. The homes also include LED lighting and drought-resistant landscaping as required under city code. One potential challenge the builder faces in selling the homes is that many homebuyers have concern or fear about energy conversion components that make up the solar system. DiPrima says the builder is working to educate the prospective buyers about the system to eliminate any questions. He said often the confusion goes away once a buyer learns how an inverter — the device that converts the power from the photovoltaic cells — works, and discovers there is a 10-year monitoring program of the equipment. “When they get comfortable there is not a lot (more convincing) to do,” DiPrima said. “They get excited about it.” KB bought Arroyo from a bank after the original developer defaulted on the property, DiPrima said. The development has 36 homes that were not equipped with the solar package. Exactly half of those were existing homes, while the other half were unfinished homes that KB completed without the solar feature. To encourage KB to build the project, Lancaster cut the cost of its building permit fees and fast-tracked approvals through city departments, city officials said. “Anything with solar we put to the head of the line,” said Lancaster Mayor R. Rex Parris. The Arroyo is the second solar-related project for KB that the city helped to support. Last year, KB and Chinese manufacturer BYD Corp. teamed up to offer homeowners an optional solar power system that includes solar panels, an inverter, a battery to store the power and LED lights. The city played matchmaker to bring the two companies together, and waived its development fees for the solar-equipped model home and four other homes offered to buyers. For the second quarter ending May 31, KB reported a net loss of $68.5 million, or $.89 per diluted share, on revenues of $271.7 million. That is a wider loss from that reported in the same period in 2010 when the loss was $30.7 million, or $.40 per diluted share, on revenues of $374 million.